New Zealand Rural Land Company (NZL) H1 2024 earnings summary

Executive summary

• Net profit after tax for HY24 rose to $12.4 million, with EPS at 9.18 cents per share, and AFFO per share up 26.8% to 1.94 cents year-over-year.

• Portfolio diversification improved with acquisitions in apple orchards and forestry, reducing dairy exposure and adding new tenants.

• Dividend resumed at 1.46 cents per share (75% payout), and a share buyback program continued.

• Roc Partners/Land Trust acquired 25% of the portfolio for $44.2 million, supporting growth, capital recycling, and debt repayment.

• Sustainability initiatives advanced, including native forest regeneration and a green loan aligned with UN SDG 15.

Financial highlights

• Total assets reached $423.5 million; net asset value was $216.9 million as of 30 June 2024.

• NAV per share was $1.552 (rounded to $1.55 in some reports); NTA per share was $1.5421.

• Gearing reduced to 30.5% from 36.2% year-over-year.

• AFFO for the half-year was $3.6 million, up from $2.1 million year-over-year.

• Dividend of 1.46 cents per share paid, with payout ratio at 75% of HY24 AFFO.

Outlook and guidance

• FY24 AFFO forecasted at $7.0–$7.5 million, or 5.01–5.36 cents per share, driven by acquisitions and CPI-linked rental increases.

• Second half FO per share expected to grow due to CPI rent increases and higher-yielding acquisitions.

• Dividend payout policy set at 60–90% of FO/AFFO, with current payout at 75% and DRP reinstated.

• No further small acquisitions planned for FY24 or early FY25; future acquisitions will be opportunity-driven.

• Cash from Roc Partners/Land Trust transaction to be deployed for further growth opportunities.